Section 19 Notices

Contact Armstrong Legal:
Sydney: (02) 9261 4555

A section 19 Notice under the Australian Securities and Investment Commission Act 2001 can be issued by the Australian Securities and Investment Commission (“ASIC”) to require a person to assist them in an investigation that they are conducting including by being examined (through questioning in a formal setting).

A requirement under a section 19 Notice is mandatory and failure to comply with it is an offence which can, in some circumstances, result in a prison sentence.

Section 19 of the Australian Securities and Investment Commission Act 2001 provides the power for ASIC to issue a Notice and it says that:

This section applies where ASIC, on reasonable grounds, suspects or believes that a person can give information relevant to a matter that it is investigating, or is to investigate, under Division 1.

ASIC may, by written notice in the prescribed form given to the person, require the person:

To give to ASIC all reasonable assistance in connection with the investigation; and

To appear before a specified member or staff member for examination on oath and to answer questions…”

ASIC has the power to issue a section 19 Notice to any person if they have reason to suspect the person can provide information relevant to any matter that ASIC is investigating.

ASIC regularly requires company employees, wives of directors, accountants and lawyers and other advisors to comply with a section 19 Notice, including by undertaking a compulsory examination when they are investigating a company for potential offences or breaches of the corporations law.

DO I HAVE TO COMPLY WITH A SECTION 19 NOTICE?

Yes. You must comply with any requirement imposed under a section 19 Notice, including attending a compulsory examination. You risk committing a criminal offence if you do not comply with a section 19 Notice.

There is, however, some significant nuance to the powers which a section 19 Notice confers on ASIC and, as such, if you have been served with one it is imperative that you seek advice, and more than likely representation, from a lawyer who is experienced in the area.

WHAT RIGHTS DO I HAVE UNDER A SECTION 19 NOTICE?

While you are obliged to comply with the requirements of a section 19 Notice, you do have some rights in relation to what you do or don’t do.

Importantly, you are entitled to be represented by a lawyer at a section 19 Examination which means that, if you are required to attend to be questioned by an ASIC investigator, you can have a lawyer present. You are also entitled to obtain legal advice and/or representation when providing information, books or records, in compliance with a section 19 Notice.

You are required to answer questions, or hand over books and records or other information, even if doing so would risk making you subject to a penalty. You are not required to incriminate yourself however if, before answering a question, or providing a book/record, you claim in front of an investigator that the response risks making you subject to a penalty.

For more information on the way ASIC conducts section 19 examinations, and how to prepare for one, please refer to our Section 19 Examinations page.

where to next?

If you suspect that you may be under investigation, or if you have been charged with an offence, it is vital to get competent legal advice as early as possible. Our lawyers are highly specialised in corporate crime and will be able to guide you through the process while dealing with the various authorities related to your matter.